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MEETING SUMMARY Council Members Present: Guests: Council Staff: Welcome &
Introductions I. Approval
of 10/12/01 meeting summary Roger highlighted the extensive work being done by the agency reorganization Transition Team trying to guide the merger of DES and DTED. Roger noted that several members of the Council are officially on the Transition Team – Willie Negaard, Arlene Lesewski, Dave Johnson, Bob Gunther, and Rebecca Yanisch. He also noted that both he and Earl Wilson have been active participants and that GWDC staff Luke Weisberg and Kathy Sweeney have been key staff support to Morrie Anderson and the Transition Team process. Roger said that the Team was nearly ready with its final report and that he felt it had been a fairly rigorous process with a solid result. He asked other members to offer their perspectives. Senator Lesewski said it was a tough process in the beginning, with several meetings before a plan emerged. She feels it is a good plan, bringing together the key elements of the two agencies. She commented that a lot will hinge on leadership – particularly the Deputy Commissioner positions identified as heading up the workforce development division and the economic development division. Structurally, it seems like the right approach that could have a meaningful impact on how we put our state and federal dollars to work in the future. Putting these two agencies together will help us work more efficiently on workforce and economic development. Sen. Lesewski noted that we did have buy-in from five of the legislative members, even though we may have some amendments, the plan should move forward. She suggested that there may be some opposition from the Maple River Education Coalition (MREDCO), the group founded by Allen Quist, concerned about government overstepping bounds in directing young people to careers. Willie Negaard echoed Sen. Lesewski saying that he felt the Transition Team did a good job putting the document together, but now it is up to the Legislature to act on it. Roger noted that a key reason to have legislative members on the team with business, labor, and education leaders is to have buy-in of the plan so that we shouldn’t have to go through a long legislative process. Earl concurred, that the product is sound, it was a very elaborate process, and now it is up to the Legislature to act. Sandra Peterson asked why MREDCO would question the structure of the workforce development and economic development agency? Sen. Lesewski said they object to language and legislative intention that suggests young people are “workforce resources”. They are concerned that young people are being steered into certain schools that meet the needs of employers, but takes away individual choice. They feel it infringes on parents’ responsibilities. Sen. Lesewski said she has disagreed with members of the group around School-To-Work issues. She also noted that Senator Bachmann was at the last Transition Team meeting meeting taking notes and that if GWDC members had questions, they could speak to Senator Bachmann. LaDonna Boyd said that she had not paid a lot of attention to this group in years past, but increasingly finds that they are raising concerns that need to be addressed. Other Council members agreed that the concerns of this and other groups have gotten the attention of some legislators and need to be dealt with in the legislative environment. Sen. Lesewski suggested that any information that can be prepared to offer an alternative point of view and additional facts would certainly be welcome. Roger said that while some of their concerns may be overstated, we have to be responsive to them, and also be clear about what we’re trying to do. There was additional discussion among members acknowledging that there is a good deal of misunderstanding and misinformation about what MREDCO “stands for” and where there are conflicts between the direction the GWDC is heading and the MREDCO perspective. It was suggested that perhaps we invite them to a future Council meeting for a presentation and discussion. Members agreed this would be a valuable part of a future agenda. Fingerhut dislocations and Dislocated Worker Program fundingRoger turned the agenda to the pressing news about the imminent shutdown of Fingerhut. As reported in the news, there is either a pending sale to another company, a sale to previous management (or some other group), or closure. Julie Idelkope highlighted the work DTED and Commissioner Yanisch have been doing regarding Fingerhut. At issue is the loss of 4700 jobs from the shutdown, quite devastating to our state and to the resources we have available to serve dislocated workers. Julie said that she and Rebecca have been in close contact with Fingerhut management, assuring them that we want to work with them on any possible solutions – including any role the State might play in bringing groups to the table for a possible buyout. Julie reiterated that, obviously the biggest concern is layoffs from their current workforce. Paul Moe, Director of the Dislocated Worker Program gave some background on working with Fingerhut. The Dislocated Worker Program has funded 5 programs with Fingerhut since 1997: $300K for 166 workers in 1998; $180K in 1999 for Minnetonka operations for 50 workers. $220K in 2000 for 118 workers; $975K in early Feb 2001 for 300 workers and again in March 2001 for 460 workers in Mora. The Rapid Response team is on it now and will be setting up emergency meetings such as those held for Northwest Airlines. Paul noted that the Dislocated Worker Program now has $3,400,000 in mass layoff dollars, pre-Fingerhut, for the remaining five and a half months of the fiscal year, statewide. We received notice through MDES Asst Commissioner Jim Korkki, that the USDOL has tentatively agreed that MN can spend some of the $8 million granted to us for airline industry layoffs for “other industries”. They will allow us to use the other related companies which will take some pressure off the mass layoff dollars. Still, this fiscal year so far, we have had twice as many mass layoffs as compared to last year. Don Gerdersmeier noted that the Fingerhut will not be the last at the bottom of this recession. He asked how can we finance both the Fingerhut need and other additional needs? Is it possible to get a loan from the General Fund until tax revenue can be raised to pay back the workforce development fund in the future? Don suggested that the GWDC should be weighing in on this as it is obviously a pressing workforce issue. Lee Helgen said that the MN Workforce Council Association (MWCA) has been working on this and he offered handouts showing both the demand on the Dislocated Worker Program (and workforce development fund for financing) and the status of the workforce development fund now regarding revenue. Handout A shows the changes in the number of layoffs. Handout B shows what happens if you change the structure and/or taxing rate of the workforce development fund. Roger suggested that it might be difficult for the full Council to develop specific programmatic and/or funding solutions right now during this meeting. He suggested that the Council could direct the Executive Committee to focus on this to see if we can come up with some kind of recommendation for the Legislature. For the balance of today’s discussion, he asked for ideas and reactions from the Council. Don suggested that staff research how much has been taken out of reserve over the years by previous legislatures and Governors. Earl answered that question, saying it has been about $60 million in total. Wayne DeBruin offered that while many Crenlo employees have been helped by the Dislocated Worker Program, he could not support an increase in the tax – because, as in years past, this has never helped in the long run. He noted that if a tax increase is the only solution, it should be temporary, needed for one or two years, and then stopped. Don agreed that if we do anything to the statute, we should add language, as Iowa did to their statute, that protects the investment by ensuring that the money is used for what its collected for. Larry Mareck agreed with all the comments, and concurred that the Executive Committee should develop some suggested solutions to get money available for dislocated workers. He noted that the human impact in the St. Cloud area would be devastating. Larry felt it was important for this group to come up with something to support St. Cloud workers. He volunteered to be a voice for this on behalf of the Council to the Mayor of St. Cloud. There was additional discussion on the specifics of the Fingerhut response and a GWDC solution to the broader problem of funding to support dislocated workers. Michael Murphy gave background on his involvement in St. Cloud in the past few days. He noted that while there has already been a good deal of activity, there was some concern about how the state should respond, and who should lead such a response. Roger said that he understood the Mayor of St. Cloud together with the Stearns-Benton Workforce Council, and other local leaders were creating an appropriate response plan. He felt the best role for the GWDC was to delegate a task to the Executive Committee to follow through on today’s discussion. He summarized the sense of the group that we are mindful of the need to raise revenue for the workforce development fund, specifically to serve dislocated workers and that we should go on record with suggestions as to how to raise that revenue. It was also clarified that additional revenue should be focused solely on meeting dislocated worker needs in the short-term. A motion was made and seconded that the Executive Committee craft a resolution expressing the concern of the GWDC that there is inadequate funding from the workforce development fund to meet the current needs of Minnesota’s dislocated workers. In discussion on the motion, Peter Michalowski said that a key part of our message should be to restore whatever money has been taken out of the fund for purposes other than workforce development. Why should businesses have to pay more or again for something they’ve already funded? Arlene also suggested that we should draw attention to the fact that this has been going on for many years. Willie Negaard, Gordon Aanerud, and others concurred. Luke noted that the GWDC discussed this issue in 2000 around the recommendation of the Governor’s mini-cabinet to “blink off” the tax. A that time, the sense of the Council was that money in the workforce development fund should be limited to workforce development purposes, not specifically the Dislocated Worker Program. What language should be used this time? Arlene suggested that, at this point in time, we need the more restrictive language limiting spending to serve dislocated workers. Mary Haug concurred. There was additional discussion on the motion including concern from Bob Niemic that the full Council should see the resolution and recommendations prior to the Executive Committee sending it on to legislative leaders. Roger acknowledged the delegation of authority to the Executive Committee, but also suggested that we could poll the Council via e-mail and solicit feedback that way. Timing seems important in getting this done. LaDonna, Gordon, Larry, and others concurred that timing was key, and that they felt comfortable with the Executive Committee taking responsibility for the task. Don asked if, indeed, money that was taken out of the fund was restored (approximately $60 million), would a tax increase be needed? Paul Moe explained that the current tax rate (.07%) generates about $26 million annually, but that because programs make commitments beyond a single year, this results in less than the revenue generated in a given year being available for that year. Other members suggested that while the GWDC may ask for funding to be restored from the General Fund to the workforce development fund, it was politically unlikely to happen. Consequently, we may need to both restore some funding and/or address the actual tax rate and structure. Roger clarified the charge to the Executive Committee. The first priority is to restore funds that have been taken out of the workforce development fund over time and make it available for immediate Dislocated Worker Program needs. If there is a need for additional revenue, we’ll address that as a second priority. The Executive Committee will draft a resolution, send it out for comment, and then incorporate feedback before presenting it to the Legislature. The motion was called, and was unanimously passed by the Council. III. Committee Reports
Willie noted that the South Central Workforce Council went through the document and using it to define priorities for their geographic area. Roger said they would use that as an example for other Local Workforce Councils. B. LaDonna Boyd reported on the Sustaining and Enhancing the Workforce Committee. The Committee has done a strategic mapping process with Mary Rothchild from MnSCU to focus on two issues in preeminence document: addressing skill shortages and improving business productivity that results from education and training for employees. The Committee has had several presentations and discussions on how skills shortages are addressed systemically in the workforce system and how productivity measures for businesses are captured. LaDonna mentioned work with ISEEK, the GWDC Families Forward initiative, and the Labor Force Assessment Grants that DTED supported all as sources of information that the Committee has reviewed. The Committee expects to be ready to report back to the full Council in July on its work. C. Sandra Peterson reported on the Supporting the Emerging WorkForce Committee. The Committee has recently focused discussion on the disappearance of vocational education dollars at the K-14 level. Last year, there was a one-year allowance for school districts to levy for vocational programs, and now its gone. The Committee feels that school districts should be allowed to continue a local levy for vocational education. Dan Smith noted that the Dept of Children, Families, and Learning proposed a continuation of the levy, but it did not make it through the process within the Department. From the CFL perspective, we’ve done what we could for now, it may show up in the legislation again but unsure as to it at this time. Sandra asked the full Council to endorse the committee’s recommendation to extend the levy opportunity for local school districts. A motion was made and seconded to endorse the Committee’s recommendation to continue the local levy opportunity. In discussion on the motion, Sen. Lesewski said that the twenty-six superintendents in her legislative district were in favor of continuing the levy for the dollars and that a vote would pass in the school board if allowed to make decisions at the local level. The motion was approved by the full Council. Sandra also noted that the Committee has discussed ongoing concerns about the shortage of guidance counselors available to students; and information available to teachers to generally help students explore career options. She suggested that we need to find much better ways of communicating with teachers about what is happening in the labor market. The continued enhancement of ISEEK and other career information tools is an important part of dealing with this ongoing concern for the committee. Roger affirmed that he has been a longtime fan of ISEEK and views it as a very positive and useful tool for students and others. Jim Johnson noted that one tool for getting counselors and teachers with better labor market information is to get them from other occupations. He said that their counselors have to have 5 years in one occupation before coming to work for the college. We find this to be a useful way of addressing this issue. D. Mary Haug reported that the Supporting Self-Reliance Committee has not met recently, but that members have been involved in creating the “Making Work Work” conference, a one-day seminar on Feb 6th, at the Radisson Riverfront Hotel in Saint Paul. Mary thought this would be beneficial to have GWDC members attend. The focus of the event is answering the question: “Can we build a better workforce and reduce poverty at the same time”. E. Don Gerdesmeier reported that the Ad Hoc Committee on WIA Issues met again on January 4th and reviewed the first draft of outcome information put together by MDES. MDES staff are working on condensing that material and creating a format for presenting our program outcomes. In addition, Jim Korkki and Mick Coleman came to the Committee and explained where we are at on the MDES’ request for a waiver on implementing the certification for WIA-funded training providers. A request has been submitted and we are waiting to hear back from USDOL on this matter. Finally, Don reported that the Committee reviewed a plan prepared by MDES and GWDC staff to update the Gunther Report, a.k.a., Employment and Training Inventory. This is an important piece of work that now has old data and, could be a significant step forward toward building common measures and being able to, over time, compare program outcomes among workforce programs. Don presented three options to the Council and said the Committee’s suggestion was to commit to the first option, spending funds currently in the GWDC budget to complete an initial update by July 2002. Don also noted that we’ve had some preliminary conversations with legislative leadership about talking further with them to get their guidance on future updates to the report. Roger noted that updating the Gunther Report is very important and timely. He thought it would be particularly helpful to legislators and Administration leaders moving forward with the agency transition to have an initial update completed this summer. Don asked if the Council was in favor of moving forward as recommended? Members indicated their interest in doing so. Don said the committee is scheduled to meet again in February to review again issues regarding the waiver for ‘certification’ of training providers and other WIA performance issues. F. Roger reported on the Executive Committee’s recent work. He reminded the Council that we have made two grants to test the usefulness of conducting “regional scans”. One grant was to the Stearns- Benton Employment and Training Council for the St. Cloud area. The other grant was to the Twin Cities Economic Development Group for the metro area. Each is conducting a regional scan, bringing together a wealth of information from those geographic areas and bringing together stakeholders from across institutional boundaries to review the information and think strategically about their regions. We will have more updates on this work at future meetings. He noted that having GWDC staff involved in the transition planning around regional work has been a good linkage for us to ensure that these efforts don’t go in separate directions. The Executive Committee has been very involved fulfilling its legislative mandates around the WorkForce Center strategic plan and common performance measures with the MN Job Skills Partnership Board. Roger underscored that GWDC staff have worked closely with the people at the Job Skills Partnership Board and others to bring standards discussions together so we don’t have different people coming up with different standards and we will have as much continuity and coordination as possible. Will be using the Spring Leadership Institute to have good discussions on this. On the Workforce Center Strategic plan, we want to talk specifically about where we are in the process and get some feedback from the Council. The Legislature charged this Council to lay out a decisionmaking framework for where WorkForce Centers should be and how they should function. We approached it as primarily local decisions, and tried to come up with questions for local workforce leaders to ask. We created a guidebook for what you could do in your own area. Roger then walked the group through the six dimensions for analysis outlined in the report and asked for comment and discussion. Jaye Rykunyk offered congratulations to the Council for bringing this work forward. She felt this was a strong contribution to making our WorkForce Center system stronger and more accountable for serving jobseekers and employers. She offered several specific edits and suggestions to be considered for incorporation in the final report. Sandra Peterson questioned how the “priorities” listed under the “local need” section were determined? Aren’t these likely priorities in other geographic areas as well? Others commented that this seemed confusing to them as well. Staff noted that we will either clarify these items, or perhaps take it out of the document entirely. Arlene Lesewski identified WorkForce Centers in her area as innovating by holding ABE/ESL classes on site in the evening. This seemed like a good example of a local area responding to local need. Several members commented on the need to strengthen the recommendations regarding programmatic flexibility. There was general consensus among Council members that if WorkForce Centers are to become focal points for employment activity in an area, they need to be able to respond to local need. Some members also noted that just because there is a local need, it may not necessarily be the Local Workforce Council’s responsibility to respond – the issue may fall outside of their jurisdiction. Members acknowledged that there are limitations to the reach of a local WorkForce Center, but also suggested that programmatic flexibility within the Local Workforce Council’s domain would almost certainly be beneficial under any circumstance. Michael Murphy noted that in order for many of the accountability-related elements of the plan to be effectively implemented, we would need to significantly improve coordination around data collection and reporting. Staff agreed, and suggested that this point could be highlighted in the final report. Tom Norman questioned the language regarding an “honest broker” role for WorkForce Centers. He suggested that the document now reads as though there is a question about some stakeholders effectively playing an “honest broker” role. This should be addressed and clarified in the final document. Finally, there was extensive discussion of the broad context in which the WorkForce Center Strategic Plan is being developed. If indeed there will be an overarching vision for economic and workforce development in the state developed by the MN Economic Leadership Team (MELT) as described by the Transition Team, then the WorkForce Center strategic plan will fit into that framework. Several members suggested that the outcome of the transition deliberation will affect the implementation of the WorkForce Center Strategic Plan. Wayne DeBruin suggested that the document would benefit from a little more context at the conclusion of the report…something that more clearly puts this work in the context of the transition. Roger agreed and concurred that staff will strengthen points in the document where context can be added. Roger concluded this discussion noting that a key element of the WorkForce Center Strategic Plan is the developing of an ongoing credentialing or certification process that would take state standards and give local leaders responsibility for certifying that local WorkForce Centers are meeting or exceeding established standards. There will be a connecting point between the credentialing framework and the implementation of performance standards now in place for federally funded activities and under development by the MN Job Skills Partnership Board for state-funded activities. IV. New BusinessRoger noted that the GWDC Spring Leadership Institute is planned for April 10th and 11th. He asked if members were amenable to moving the scheduled April 12th full Council meeting to the 11th to coincide with the event. Members agreed to that schedule change. He also noted that the MN Workforce Council Association will be hosting a reception the evening of April 9th and welcomed members to attend that event prior to the Leadership Institute. Jaye Rykunyk mentioned incorrect references to organized labor involvement in the World Trade Organization protests included in the Economist reprint mailed out to GWDC members. She asked all members to take note of the erroneous reference in their reading of that material. With no additional business coming before the Council, the meeting was adjourned.
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